RURAL GODOWN SCHEME (GRAMIN BHANDARAN YOJANA)

In India about 165.77 mill. Ha land is under agriculture, producing 526.77 mill tons of agriculture produce comprising mainly food grains, pulses, oilseeds, cotton, jute, sugarcane, etc. The agriculture production of the country has increased four fold during the last five decades. However, in spite of being self sufficient in production of food grains, the farmers are unable to obtain remunerative prices for their produce. They lack sufficient storage facilities, distributed in various parts of the country.

Necessity of Godowns:

• To store food grains in scientific manner, minimise losses and maintain quality.
• To avoid damages by rats, birds, small insects etc. and deterioration in quality of the grains.
• Non-availability of storage facilities at the farmers, forces them to sell their produce during the peak harvest season, when prices are the lowest depriving of remunerative prices.

Benefits of Godowns:

• Scientific storage leads to maintain quality of food grains.
• In godowns, frequent spraying of insecticides and fumigation of food grains make them safe from rats, and small insects.
• Remunerative price is realised for food grain, stored in Godowns leading to improved income to the farmers.
• The farmers can expect pledge loan of 70 % against stored produced.
• If godown is run on commercial and professional lines by farmers Cooperative sales and purchase societies, it will lead to an increase in their incomes and help in employment generation.
• The time limit of this scheme is upto 30th March2007.

The salient features of the scheme are as follows

Nodal agency: Director of Marketing , Maharashtra State, Pune.

Eligible Organisations: The construction /expansion of rural godown can be taken up by individuals, farmers, group of farmers /growers, partnership /proprietary firms, non government organisations, self help groups, companies, cooperative societies, Agriculture Produce Marketing Committees, Marketing Boards and Agro-Processing Corporations in the country. Assistance is also available for renovation / expansion of rural godowns (restricted to the godowns constructed by co-operatives only).

Location: The construction of godown has to be made outside the limits of Municipal Corporation, with a minimum capacity of 100 MT and restricted to a maximum capacity of 10,000 MT.

Credit Linked Assistance: Subsidy under the scheme is linked to institutional credit and available only to such projects which are financed by commercial Banks, Co-operative Banks, Nationalised Banks and Regional Rural Banks. Loan to the entrepreneurs, from banks for the construction of godowns would be over a period of 10 years, and should be repaid in 11 installments with a moratorium on repayment of 2 years. The construction of godown shall be completed within 15 months.

Nature of the Scheme

• 25% Government subsidy
• 25% own funds investment
• 50% Bank Loan
• If the entrepreneur possesses own land, 10% of estimated godown cost will be considered as land cost out of his own investment.

Subsidy: Subsidy under the scheme shall be provided on the capital cost of the project, as below:

• The rate of subsidy will be 25% of the capital cost of the project. In case where the entrepreneur belongs to S.C./S.T. the rate of subsidy shall be 33.33 per cent.
• From 1st Oct. 2004 few changes made in by Central Govt. in this scheme are for farmers, Agricultural graduates, Co-op. societies state & central wearhousing corporation are eligible for 25% subsidy & remaining can get 15% subsisy.
• Minimum size of godown eligible for subsidy would be 100 MT
• Capital cost of the project for releasing subsidy under the scheme shall be calculated as follows:
  • For godowns upto capacity of 1000 MT, actual cost or Rs. 2000/- per ton storage capacity, whichever is lower.
  • For godowns exceeding capacity of 1000 MT, actual cost or Rs. 1500/- per ton storage capacity, whichever is lower.
  • For Renovation / Expansion of Godown constructed by cooperatives with assistance from NCDC, actual cost or Rs.500/- per tone of storage capacity, whichever is lower.
• Amount of subsidy calculated as above, shall be further restricted to a maximum storage capacity of 10,000 MT and further to a maximum amount of Rs. 37.50 Lakhs, for each project. Entrepreneur belongs SC/ST, maximum amount of subsidy shall be Rs. 50 Lakhs, for each project.
• Subsidy for the project under the scheme, shall be realised through the NABARD for project finance by the commercial, cooperative and regional rural Banks.
• The capacity of the godown, will be calculated 1.8 MT per sq. m. of floor area with an average height of not less than 4.5 m. Minimum capacity should be 100 MT in some cases (physical/special requirement) permission should be required from related office-
  for that NABARD is going to issue the guidlines for the same.

Training: The training will be arranged to the officers and honorary persons for maintaining godowns, scientific storage, record etc.

Proposals: Loan/ Subsidy proposals shall be prepared in Bank Proforma and proforma given by Agricultural Marketing Board, Pune along with the necessary documents. Seven copies of the proposals shall be prepared and submitted as below.

• 3 copies to bank
• 1 copy to Dist. Deputy Registrar
• 2 copies to Agricultural Marketing Board.
• 1 copy for entrepreneur.
  

Documents:
1. Application, 2. 7/12 Extract, 3. 8-A Extract, 4. NOC from municipal corporation 5. plan, 6. Estimate.
Apart from this do-operative societies required following additional documents -
1. Board of Director's meeting resolution,2. Audit Memo Copies,3. Financial report of last 3 years.

The recommendation from Dist. Deputy Registrar shall be required before submitting to the above agencies.

Target for Construction of Godown under this Scheme: In Maharashtra State under this scheme 5000 Godown construction target is fixed. Following chart showing the position of 30 Dec. 2004.

Central Govt.Memorandum